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Last Updated : Oct 18, 2019 03:45 PM IST | Source:

Point-of-Sale channel is a new employment generator in insurance

Since there is minimal licensing involved, candidates do not have to deal with a quagmire of procedures to start work.

Moneycontrol Contributor @moneycontrolcom

Anik Jain

In 2015, the Insurance Regulatory and Development Authority of India (IRDAI) had launched a new distribution model to increase the penetration of insurance sector in the country, the Point of Sale Person (PoSP). Apart from the evident benefit (in terms of choices and greater awareness) to consumers, the introduction of PoSPs in the insurance sector value chain has impacted a crucial area of the economy--employment.

Despite the steady growth and development of India, the rate of insurance penetration remains low. Approximately 900 million people in the country do not have any type of insurance. The reasons are plenty, with a lack of awareness surrounding the benefits of insurance and a low disposable income being two major ones.


Of the two, inadequate awareness can be solved with outreach efforts. To increase market penetration, the insurance sector requires more agents who can travel the last mile. A simple and quick certification process is required to achieve this. IRDAI's approval of PoSPs has paved the way for getting distributors on board quickly.

A PoSP is a broker or distributor who can be employed by insurance companies with minimal official licensing. PoSPs are essentially insurance agents who work at the grassroots level to offer consumers different insurance products. Their job entails issuing transparent, non-underwritten policies on the spot.

They possess comprehensive knowledge about the variety of insurance policies and hold the authority to offer their customers a magnitude of options like medical, term, critical illness, health, and life plans to choose from. Their job is to educate consumers about the different kinds of policies available and help them choose one which best suits their needs.

PoSPs require a basic degree of training and can sell some primary insurance products that don’t involve heavy underwriting such as motor and travel insurance, the quotes for which can be automatically generated.

There are several factors that make the job of a PoSP viable and attractive to varied groups of individuals in the country such as:


One does not need higher education to become a PoSP. Individuals that have cleared the 10th grade and are 18 years of age now have the opportunity to secure a dignified job and support their families. A PoSP is a broker who does not require high qualification or training, and this directly coincides with a boost in employment opportunities.

Ease of certification

Instead of spending money and time on qualifying examinations, individuals can become a PoSP quickly and free of cost. IRDAI has allowed intermediaries to conduct examinations as per its guidelines. IRDAI has also allowed intermediaries to train such individuals in-house.

Training helps PoSPs gain technical skills, product knowledge, and crucial soft skills such as communication and networking. The short training period allows candidates to start earning money immediately. Because a PoSP can sell multiple insurance policies, and not just one, they have the opportunity to earn a higher income.

Simplified training procedure

Potential insurance advisors need to undergo a 15-hour training process to get well-versed with different insurance policies. PoSPs are only allowed to sell basic insurance products such as motor, travel, personal accident insurance which are simple to understand, and where the benefits are stated upfront and are predefined. In fact, IRDAI guidelines state that the life insurer will be held responsible for the actions and behaviour of a PoSP.

Improved standard of living

PoSP programmes provide a steady source of income to the candidates. The role of a PoSP can be fulfilled from home and requires minimal paperwork- most of which can be filed online. Furthermore, they are introduced to new-age digital technology to make their jobs easier and to improve their customers’ experience. PoSPs are also trained to improve their technical skills, soft skills and product knowledge for effective communication with clients. This helps PoSPs come closer to an improved living standard and quality of life.

Insurance is increasing employment generation

Not only does the introduction of PoSPs aim towards increasing awareness and covering the Indian populace under insurance but it is also creating more job prospects and contributing to the economic growth of the country.

Since there is minimal licensing involved, candidates do not have to deal with a quagmire of procedures to start work. This offers a good source of income, allowing PoSPs to increase their standard of living while learning new skills through extensive training.

By introducing the PoSP distribution model which requires minimal educational qualifications, an enterprising spirit, and the ability to work hard and smart, the IRDAI has opened new doors of employment for India’s youth. By approving this new model, the IRDAI has given a new lease of life to the country’s youth, allowing them to get a regular source of income, develop their skills, and usher in prosperity in their lives.

The writer is co-founder & CEO, Symbo India Insurance Broking

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First Published on Oct 18, 2019 03:45 pm

tags #Business #HR

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